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 user 2010-11-24 at 9:11:52 am Views: 72
  • #24018

    you need a bandage, you reach for a Band-Aid.When you’re in the mood
    for gelatin, you eat Jell-O.When you need to copy a document, you look
    for a Xerox — thanks to Joe Wilson.Wilson saw an opportunity, ignored
    naysayers and put his stamp on the revolutionary machine.The result was
    the Xerox 914 — unveiled in 1959 as the first easy-to-use copying
    machine.In the process, Wilson turned a family business into Xerox Corp.
    , a corporate giant that had $18 billion in sales in 2009.”I believe
    that the story of Joe Wilson is one of the great industrial stories of
    all time,” said Horace Becker, a retired vice president for research and
    development at Xerox, who in the 1950s was chief engineer of the 914
    project. “He just provided the overall major direction and the fertile
    soil, and we were able to go out and dig and plant and harvest.”Joseph
    Chamberlain Wilson was born in 1909 in Rochester, N.Y. He graduated from
    the University of Rochester with a degree in economics and by 1933 had
    an MBA from Harvard.

    Wilson’s Keys
        * Adopted
    xerography’s revolutionary technology.* “Great rewards come to those who
    see needs that have not been clearly identified by others, and who have
    the innovating capacity to devise products and services which fill
    these needs.”Amid the Great Depression, he managed to find a job with
    Haloid in 1936. This was a small manufacturer of photographic paper and
    equipment that was founded by his grandfather J.C. Wilson. By 1944, Joe
    was vice president, overseeing all operations, and he took over as
    president when his father retired.

    Peace At A PriceWith World War
    II over in 1945, the company’s military orders shriveled. Facing stiff
    competition, the firm needed a new product.”They were making sensitized
    paper in direct competition with a gigantic company,” noted Becker. “His
    competitor was Eastman Kodak (EK) down the street.”According to “Joe
    Wilson and the Creation of Xerox,” a book by Charles Ellis, higher wages
    and silver prices were also hurting Haloid’s bottom line. Revenue
    surged to $9.7 million in 1949 from $3.9 million in 1940, but the firm’s
    profit margin grew by only 30%.Wilson had a choice: Watch Haloid die or
    reinvent the company.

    Time for new ideas.
    “Joe was not
    an engineer; he was a financial guy running a company that he
    recognized had no future,” Becker said.Wilson instructed his R&D
    director, John Dessauer, to inform him of any promising
    technologies.Soon, Dessauer led him to a copying technology called
    xerography, electrophotography or simply dry writing. Invented by patent
    lawyer Chester Carlson in 1938, xerography didn’t need chemicals or
    carbon paper to make copies. It used static electricity, light and
    powder to transfer images to other paper.Carlson showed his discovery to
    General Electric (GE), IBM (IBM) and RCA, but none showed much interest
    in developing xerography for commercial purposes.Carlson’s device did
    spark interest from the Battelle Memorial Institute, a research firm,
    and they signed a royalty-sharing contract in 1944 to advance the
    technology.Having heard from his R&D whiz about xerography, Wilson
    saw light in Haloid’s future. So in 1947 he pressed ahead, buying rights
    from Battelle to make a copying machine with Carlson’s method.Two years
    later, Haloid had rolled out its Model A copy machine. Only one
    problem: The product bombed. It was nonautomatic, involved too many
    steps and made fuzzy copies.

    New Name
    As Wilson aimed
    to improve the machine, Haloid gained a tighter grip on the process. In
    1950, the company reached a deal with Battelle to become the sole
    licensing agent for all patents based on xerography.Now Wilson ramped up
    spending. The rest of the decade his firm shelled out $12 million —
    worth $88 million today — to make its next copy machine based on
    xerography.That was more than it earned in that period, so Wilson used
    stock and loans to buy patents. He was so locked in on his target, he
    came up with a variation on xerography to reflect the new direction,
    changing his company’s name to Haloid Xerox in 1958 and to just Xerox in
    1961, Ellis wrote.

    Up Against It
    Haloid was running into resistance with its next xerography-based copier, the 914.Becker says the static came from three fronts:

    • A study conducted by consulting firm Arthur D. Little warned that 5,000 copy machines would flood the market.

    • Bell & Howell, a former maker of motion picture equipment, called the 914′s design flawed.

    • Everyone else seemed to be saying nobody wanted the product.

    there was competition, said Becker: “Two people basically — Thermofax
    produced by our friends at 3M (MMM) and another outfit, Verifax, made by
    Eastman Kodak.”Their copy machines retailed for $350, with copy sheets
    costing 19 to 25 cents.Those devices were sure cheaper than Wilson’s
    would have cost. He spent $2,000 to make each 914, so Xerox rented the
    machines for a modest monthly fee. Included in the price was a certain
    number of free copies. Customers could run off additional sheets at a
    nickel each.

    Wilson introduced the 914 on TV in September 1959,
    then put it on sale in March 1960.The 650-pound machine could make one
    copy every 26.4 seconds, or 136 an hour, at the push of button. As the
    name implied, it could handle originals up to 9 by 14 inches. Copies
    were higher quality than those of Thermofax and Verifax.The 914 stepped
    on the document-copying industry’s pedal. With such speed, sales zoomed
    along with publicity. Fortune magazine dubbed the 914 “the most
    successful product ever marketed in America.”

    By 1962, Xerox had
    sold 10,000 machines, or double what the Little study had predicted.
    From 1960 to 1965, sales surged 900%. “We were part of a revolution,”
    Becker said. “I would never have gotten a chance to be a soldier leading
    that revolution if Joe Wilson did not have the courage to say proceed.”

    “How to Make Money in Stocks,” IBD founder William O’Neil wrote: “It
    takes something new to produce a startling advance in the price of a
    stock.”For Xerox, the 914 was the N in CAN SLIM. That new element helped
    Xerox break out of a classic cup-with-handle base in June 1960 and soar
    more than 1,200% in just over 3 1/2 years.The stock cleared another
    base in June 1963 and soared more than 600% in a little over three
    years.Joe Wilson died in 1971. Nine years later he was inducted into the
    Junior Achievement U.S. Business Hall of Fame.

    Man To Remember
    name is on Wilson Commons and Wilson Boulevard at the University of
    Rochester and part of the city’s Joseph C. Wilson Magnet High School. In
    1963, Wilson and his wife established the Marie C. & Joseph C.
    Wilson Foundation to help charitable causes.”Joe Wilson had an eye for
    innovations, the patience to research them and the temerity to back
    them,” said Usha Haley, a professor of international business at Massey
    University in New Zealand.She added: “In retrospect, his business
    actions look rational. In actuality, they were inductive leaps and bets
    on future promise.”